What Home said

Chief executive John Walden said: "This has been a very eventful period for the group. Argos traded through a challenging market while launching significant new propositions. During the period we also commenced and progressed discussions for the sale of Homebase to Wesfarmers, and received an approach from J Sainsbury for the potential acquisition of the Group.

"Against this backdrop, whilst Argos trading performance was mixed, I am pleased that we made material steps forward in the Argos Transformation Plan. Total sales at Argos increased 0.9 per cent. They were affected by volatile trading patterns resulting from particularly strong sales during Black Friday week, a shift in consumer demand from both the weeks before and after Black Friday, growth in digital transactions, reduced store footfall particularly on the high streets, and the continuing effects of price deflation.

"I continue to believe that the capabilities being developed in the Argos Transformation Plan will position Argos as a retail leader in an increasingly digital future.

"The Homebase Productivity Plan, which includes an aggressive store closure program, overhead reductions and customer proposition improvements, has begun to position Homebase as a smaller, higher quality and more efficient business. Yesterday we announced that we are in advanced discussions to sell Homebase, which would provide good value for shareholders and a growth opportunity for Homebase colleagues.

"The potential transaction would allow the group to focus on Argos and its Transformation Plan, with an improved balance sheet and financial position, which I believe would represent an even greater opportunity for building long-term shareholder value.

In short

Argos and Homebase might not be performing all that well, but the potential bids are still making Home Retail Group look attractive to investors.